S.B. 76
- *SB76*
SENATE BILL NO. 76–COMMITTEE ON JUDICIARY
(ON BEHALF OF THE SECRETARY OF STATE)
PREFILED NOVEMBER 20, 2024
____________
Referred to Committee on Judiciary
SUMMARY—Revises provisions relating to securities.
(BDR 7-486)
FISCAL NOTE: Effect on Local Government: No.
Effect on the State: Yes.
~
EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
AN ACT relating to securities; creating the Fund for the
Compensation of Victims of Securities Fraud and
prescribing the use of money in the Fund; authorizing
certain persons to whom a court orders restitution to apply
for compensation from the Fund; requiring the
Administrator of the Securities Division of the Office of
the Secretary of State to review applications for and
award compensation from the Fund; making confidential
certain information; requiring the Division to adopt
regulations relating to the administration of the Fund;
requiring the Administrator to submit to the Legislature a
biennial report concerning the Fund; requiring a person
who receives compensation from the Fund to reimburse
the State for such compensation under certain
circumstances; revising provisions relating to certain
exempt securities and exempt transactions; revising
provisions governing the deposit of certain money
received by the Administrator; and providing other
matters properly relating thereto.
Legislative Counsel’s Digest:
Existing law establishes the Uniform Securities Act, which sets forth provisions 1
governing the sale and purchase of securities in this State in a manner consistent 2
with federal laws and regulations. In general, the Act prohibits a person from 3
engaging in certain deceptive acts, practices or courses of business in connection 4
with the offer, sale or purchase of a security. (NRS 90.570-90.610) The Act also 5
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authorizes certain sanctions against a person who violates these prohibitions, 6
including civil penalties, criminal fines and payment of restitution. (NRS 90.630-7
90.650) The Nevada Constitution entitles a victim of a crime to full and timely 8
restitution and requires all monetary payments, money and property collected from 9
any person ordered to make restitution to be first applied to pay the amounts 10
ordered as restitution to the victim. (Nev. Const. Art. 1, § 8A) 11
Section 6 of this bill creates the Fund for the Compensation of Victims of 12
Securities Fraud and requires that the money in the Fund be used for the 13
compensation of certain victims to whom restitution is owed. Section 2 of this bill 14
defines the term “Fund” to mean the Fund for the Compensation of Victims of 15
Securities Fraud. Section 3 of this bill: (1) establishes the process by which certain 16
persons to whom a court orders restitution may apply for and receive compensation 17
from the Fund; (2) authorizes an applicant to appeal a determination made 18
concerning an award of compensation from the Fund; and (3) makes confidential 19
certain information and documentation submitted in connection with such an 20
application. Section 11 of this bill makes a conforming change relating to the 21
information made confidential pursuant to section 3. 22
Section 4 of this bill requires the Securities Division of the Office of the 23
Secretary of State to adopt certain regulations relating to the Fund, including 24
regulations: (1) establishing eligibility requirements for an award of compensation 25
from the Fund; (2) prescribing certain other requirements relating to the award of 26
compensation from the Fund; and (3) establishing a procedure to appeal a 27
determination made concerning an award of compensation from the Fund. Section 28
5 of this bill requires the Administrator of the Division to prepare and submit a 29
biennial report to the Legislature that includes certain information relating to the 30
Fund. Section 6 requires the Division to prepare certain quarterly estimates 31
concerning the Fund and requires any money remaining in the Fund at the end of 32
each fiscal year to be carried forward to the next fiscal year. Section 7 of this bill: 33
(1) requires an applicant, as a condition of accepting an award of compensation 34
from the Fund, to take certain action if the applicant recovers unpaid restitution 35
after receiving such compensation; and (2) prescribes certain other conditions of 36
accepting an award of compensation from the Fund. 37
Existing law requires all money received by the Division or the Administrator 38
pursuant to the Act to be deposited in the State General Fund. (NRS 90.630, 39
90.650, 90.710) Section 10 of this bill requires all money received by the 40
Administrator as a result of an enforcement action relating to securities to be 41
deposited with the State Treasurer for credit to the Fund. 42
Existing law: (1) prohibits a person from offering to sell or selling any security 43
in this State unless the security meets certain registration requirements; (2) exempts 44
certain securities and certain transactions from the registration requirements under 45
certain circumstances; and (3) authorizes the Administrator to disallow certain 46
exemptions under certain circumstances. (NRS 90.460, 90.520, 90.530) Sections 8 47
and 9 of this bill remove a requirement that the Administrator disallow certain 48
exemptions by order, thereby authorizing the Administrator to disallow any such 49
exemption without issuing an order. 50
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THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Chapter 90 of NRS is hereby amended by adding 1
thereto the provisions set forth as sections 2 to 7, inclusive, of this 2
act. 3
Sec. 2. As used in sections 2 to 7, inclusive, of this act, unless 4
the context otherwise requires, “Fund” means the Fund for the 5
Compensation of Victims of Securities Fraud created by section 6 6
of this act. 7
Sec. 3. 1. Except as otherwise provided in this subsection, a 8
person to whom a court orders restitution pursuant to NRS 90.640 9
may, not later than 12 months after the date on which such 10
restitution is ordered, apply to the Administrator for compensation 11
from the Fund. The Administrator may waive the time limit 12
prescribed by this subsection for good cause shown. 13
2. The Administrator or his or her designee shall review each 14
application submitted pursuant to subsection 1 and determine 15
whether to award compensation to the applicant in accordance 16
with the regulations adopted pursuant to section 4 of this act. 17
3. An applicant aggrieved by a determination of the 18
Administrator or his or her designee made pursuant to subsection 19
2 may appeal the determination in accordance with the 20
regulations adopted pursuant to section 4 of this act. 21
4. The Administrator or his or her designee may request that 22
an applicant submit to the Division any additional information or 23
documentation necessary to enable the Administrator or his or her 24
designee to make the determination required by subsection 2. As 25
soon as practicable after receiving such a request, the applicant 26
shall submit to the Division any information or documentation 27
requested. 28
5. Any information or documentation contained in an 29
application submitted to the Administrator pursuant to subsection 30
1 or to the Division pursuant to subsection 4 is confidential and, 31
unless the disclosure is otherwise prohibited by law, must not be 32
disclosed except: 33
(a) Upon the request of the applicant or the attorney of the 34
applicant; 35
(b) In the necessary administration of this chapter; or 36
(c) Upon the lawful order of a court of competent jurisdiction. 37
Sec. 4. The Division shall adopt any regulations necessary to 38
carry out the provisions of sections 2 to 7, inclusive, of this act, 39
including, without limitation, regulations: 40
1. Establishing eligibility requirements for an award of 41
compensation from the Fund. 42
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2. Establishing a form and procedure for applying for an 1
award of compensation from the Fund. The form must include, 2
without limitation, an indication of the amount of money the 3
applicant has received or is likely to receive as restitution for the 4
financial harm suffered as a result of the commission of a 5
violation of this chapter or a regulation or order of the 6
Administrator under this chapter, pursuant to NRS 90.640. 7
3. Establishing the order of priority in which the 8
Administrator or his or her designee must: 9
(a) Review applications submitted pursuant to section 3 of this 10
act; and 11
(b) Award compensation to an applicant, if applicable. 12
4. Prescribing standards for the amount of compensation the 13
Administrator or his or her designee may award from the Fund. 14
Such standards must include, without limitation, a requirement 15
that such compensation must not exceed the lesser of $25,000 or 16
an amount equal to 25 percent of the amount of unpaid restitution 17
awarded by a court. 18
5. Establishing a procedure to appeal a determination made 19
by the Administrator or his or her designee pursuant to section 3 20
of this act. 21
Sec. 5. On or before January 1 of each odd-numbered year, 22
the Administrator shall prepare and submit to the Director of the 23
Legislative Counsel Bureau for transmittal to the Legislature a 24
report relating to the Fund. The report must include, without 25
limitation: 26
1. The total amount of compensation awarded from the 27
Fund; 28
2. The number of applicants who applied for compensation 29
from the Fund; 30
3. The number of applicants who were denied compensation 31
from the Fund; and 32
4. The average length of time taken to award compensation 33
from the Fund, from the date of receipt of the application to the 34
date of the payment of compensation. 35
Sec. 6. 1. Money for payment of compensation as awarded 36
by the Administrator pursuant to section 3 of this act must be paid 37
from the Fund for the Compensation of Victims of Securities 38
Fraud, which is hereby created. Money in the Fund must be 39
disbursed by the Division in the same manner as other claims 40
against the State are paid, in accordance with the regulations 41
adopted pursuant to section 4 of this act. 42
2. The Division shall prepare quarterly estimates of: 43
(a) The money in the Fund which is available for the payment 44
of compensation; and 45
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(b) The anticipated expenses of the Fund for the next fiscal 1
quarter. 2
3. The interest and income earned on the money in the Fund, 3
after deducting any applicable charges, must be credited to the 4
Fund. 5
4. The Division may apply for and accept gifts, grants and 6
donations from any source for deposit in the Fund. 7
5. Any money remaining in the Fund at the end of each fiscal 8
year does not revert to the State General Fund and must be carried 9
forward to the next fiscal year. 10
Sec. 7. An applicant who accepts an award of compensation 11
from the Fund does so under the following conditions: 12
1. The State of Nevada is immediately subrogated in the 13
amount of the award to any right of action to recover any unpaid 14
restitution, and that right of subrogation may be diminished for 15
attorney’s fees and other costs of litigation in obtaining such 16
recovery; and 17
2. If recovery is obtained for unpaid restitution, the applicant 18
shall promptly notify the Administrator or his or her designee, and 19
shall promptly pay to the Division the lesser of the amount of the 20
award made from the Fund or the amount recovered, less 21
attorney’s fees and costs. The duty of notice and payment 22
pursuant to this subsection continues until the amount of the 23
award has been repaid to the State of Nevada. 24
Sec. 8. NRS 90.520 is hereby amended to read as follows: 25
90.520 1. As used in this section: 26
(a) “Guaranteed” means guaranteed as to payment of all or 27
substantially all of principal and interest or dividends. 28
(b) “Insured” means insured as to payment of all or substantially 29
all of principal and interest or dividends. 30
2. Except as otherwise provided in subsections 4 and 5, the 31
following securities are exempt from NRS 90.460 and 90.560: 32
(a) A security, including a revenue obligation, issued, insured or 33
guaranteed by the United States, an agency or corporate or other 34
instrumentality of the United States, an international agency or 35
corporate or other instrumentality of which the United States and 36
one or more foreign governments are members, a state, a political 37
subdivision of a state, or an agency or corporate or other 38
instrumentality of one or more states or their political subdivisions, 39
or a certificate of deposit for any of the foregoing, but this 40
exemption does not include a security payable solely from revenues 41
to be received from an enterprise unless the: 42
(1) Payments are insured or guaranteed by the United States, 43
an agency or corporate or other instrumentality of the United States, 44
an international agency or corporate or other instrumentality of 45
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which the United States and one or more foreign governments are 1
members, a state, a political subdivision of a state, or an agency or 2
corporate or other instrumentality of one or more states or their 3
political subdivisions, or by a person whose securities are exempt 4
from registration pursuant to paragraphs (b) to (e), inclusive, or (g), 5
or the revenues from which the payments are to be made are a direct 6
obligation of such a person; 7
(2) Security is issued by this State or an agency, 8
instrumentality or political subdivision of this State; or 9
(3) Payments are insured or guaranteed by a person who, 10
within the 12 months next preceding the date on which the securities 11
are issued, has received a rating within one of the top four rating 12
categories of either Moody’s Investors Service, Inc., or Standard 13
and Poor’s Ratings Services. 14
(b) A security issued, insured or guaranteed by Canada, a 15
Canadian province or territory, a political subdivision of Canada or 16
of a Canadian province or territory, an agency or corporate or other 17
instrumentality of one or more of the foregoing, or any other foreign 18
government or governmental combination or entity with which the 19
United States maintains diplomatic relations, if the security is 20
recognized as a valid obligation by the issuer, insurer or guarantor. 21
(c) A security issued by and representing an interest in or a 22
direct obligation of a depository institution if the deposit or share 23
accounts of the depository institution are insured by the Federal 24
Deposit Insurance Corporation, the National Credit Union Share 25
Insurance Fund or a successor to an applicable agency authorized by 26
federal law. 27
(d) A security issued by and representing an interest in or a 28
direct obligation of, or insured or guaranteed by, an insurance 29
company organized under the laws of any state and authorized to do 30
business in this State. 31
(e) A security issued or guaranteed by a railroad, other common 32
carrier, public utility or holding company that is: 33
(1) Subject to the jurisdiction of the Surface Transportation 34
Board; 35
(2) A registered holding company under the Public Utility 36
Holding Company Act of 1935 or a subsidiary of a registered 37
holding company within the meaning of that act; 38
(3) Regulated in respect to its rates and charges by a 39
governmental authority of the United States or a state; or 40
(4) Regulated in respect to the issuance or guarantee of the 41
security by a governmental authority of the United States, a state, 42
Canada, or a Canadian province or territory. 43
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(f) Equipment trust certificates in respect to equipment leased or 1
conditionally sold to a person, if securities issued by the person 2
would be exempt pursuant to this section. 3
(g) A security listed or approved for listing upon notice of 4
issuance on the New York Stock Exchange, NYSE MKT, the 5
Chicago Stock Exchange, NYSE ARCA or other exchange 6
designated by the Administrator, any other security of the same 7
issuer which is of senior or substantially equal rank, a security 8
called for by subscription right or warrant so listed or approved, or a 9
warrant or right to purchase or subscribe to any of the foregoing. 10
(h) A security listed or approved for listing upon notice of 11
issuance on the National Market System of the NASDAQ Stock 12
Market, any other security of the same issuer which is of senior or 13
substantially equal rank, a security called for by subscription right 14
or warrant so designated, or a warrant or a right to purchase or 15
subscribe to any of the foregoing. 16
(i) An option issued by a clearing agency registered under the 17
Securities Exchange Act of 1934, other than an off-exchange futures 18
contract or substantially similar arrangement, if the security, 19
currency, commodity or other interest underlying the option is: 20
(1) Registered under NRS 90.470, 90.480 or 90.490; 21
(2) Exempt pursuant to this section; or 22
(3) Not otherwise required to be registered under this 23
chapter. 24
(j) A security issued by a person organized and operated not for 25
private profit but exclusively for a religious, educational, 26
benevolent, charitable, fraternal, social, athletic or reformatory 27
purpose, or as a chamber of commerce, or trade or professional 28
association if at least 10 days before the sale of the security the 29
issuer has filed with the Administrator a notice setting forth the 30
material terms of the proposed sale and copies of any sales and 31
advertising literature to be used and the Administrator [by order] 32
does not disallow the exemption within the next 5 full business 33
days. 34
(k) A promissory note, draft, bill of exchange or banker’s 35
acceptance that evidences an obligation to pay cash within 9 months 36
after the date of issuance, exclusive of days of grace, is issued in 37
denominations of at least $50,000 and receives a rating in one of the 38
three highest rating categories from a nationally recognized 39
statistical rating organization, or a renewal of such an obligation that 40
is likewise limited, or a guarantee of such an obligation or of a 41
renewal. 42
(l) A security issued in connection with an employees’ stock 43
purchase, savings, option, profit-sharing, pension or similar 44
employees’ benefit plan. 45
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(m) A membership or equity interest in, or a retention certificate 1
or like security given in lieu of a cash patronage dividend issued by, 2
a cooperative organized and operated as a nonprofit membership 3
cooperative under the cooperative laws of any state if not traded to 4
the general public. 5
(n) A security issued by an issuer registered as an open-end 6
management investment company or unit investment trust under 7
section 8 of the Investment Company Act of 1940 if: 8
(1) The issuer is advised by an investment adviser that is a 9
depository institution exempt from registration under the Investment 10
Advisers Act of 1940 or that is currently registered as an investment 11
adviser, and has been registered, or is affiliated with an adviser that 12
has been registered, as an investment adviser under the Investment 13
Advisers Act of 1940 for at least 3 years next preceding an offer or 14
sale of a security claimed to be exempt pursuant to this paragraph, 15
and the issuer has acted, or is affiliated with an investment adviser 16
that has acted, as investment adviser to one or more registered 17
investment companies or unit investment trusts for at least 3 years 18
next preceding an offer or sale of a security claimed to be exempt 19
under this paragraph; or 20
(2) The issuer has a sponsor that has at all times throughout 21
the 3 years before an offer or sale of a security claimed to be exempt 22
pursuant to this paragraph sponsored one or more registered 23
investment companies or unit investment trusts the aggregate total 24
assets of which have exceeded $100,000,000. 25
3. For the purpose of paragraph (n) of subsection 2, an 26
investment adviser is affiliated with another investment adviser if it 27
controls, is controlled by, or is under common control with the other 28
investment adviser. 29
4. The exemption provided by paragraph (n) of subsection 2 is 30
available only if the person claiming the exemption files with the 31
Administrator a notice of intention to sell which sets forth the name 32
and address of the issuer and the securities to be offered in this State 33
and pays a fee: 34
(a) Of $500 for the initial claim of exemption and the same 35
amount at the beginning of each fiscal year thereafter in which 36
securities are to be offered in this State, in the case of an open-end 37
management company; or 38
(b) Of $300 for the initial claim of exemption in the case of a 39
unit investment trust. 40
5. An exemption provided by paragraph (c), (e), (f), (i) or (k) 41
of subsection 2 is available only if, within the 12 months 42
immediately preceding the use of the exemption, a notice of claim 43
of exemption has been filed with the Administrator and a 44
nonrefundable fee of $300 has been paid. 45
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Sec. 9. NRS 90.530 is hereby amended to read as follows: 1
90.530 The following transactions are exempt from NRS 2
90.460 and 90.560: 3
1. An isolated nonissuer transaction, whether or not effected 4
through a broker-dealer. 5
2. A nonissuer transaction in an outstanding security if the 6
issuer of the security has a class of securities subject to registration 7
under section 12 of the Securities Exchange Act of 1934, 15 U.S.C. 8
§ 78l, and has been subject to the reporting requirements of section 9
13 or 15(d) of the Securities Exchange Act of 1934, 15 U.S.C. §§ 10
78m and 78o(d), for not less than 90 days next preceding the 11
transaction, or has filed and maintained with the Administrator for 12
not less than 90 days preceding the transaction information, in such 13
form as the Administrator, by regulation, specifies, substantially 14
comparable to the information the issuer would be required to file 15
under section 12(b) or 12(g) of the Securities Exchange Act of 1934, 16
15 U.S.C. §§ 78l(b) and 78l(g), were the issuer to have a class of its 17
securities registered under section 12 of the Securities Exchange Act 18
of 1934, 15 U.S.C. § 78l, and paid a fee of $300 with the filing. 19
3. A nonissuer transaction by a sales representative licensed in 20
this State, in an outstanding security if: 21
(a) The security is sold at a price reasonably related to the 22
current market price of the security at the time of the transaction; 23
(b) The security does not constitute all or part of an unsold 24
allotment to, or subscription or participation by, a broker-dealer as 25
an underwriter of the security; 26
(c) At the time of the transaction, a recognized securities manual 27
designated by the Administrator by regulation or order contains the 28
names of the issuer’s officers and directors, a statement of the 29
financial condition of the issuer as of a date within the preceding 18 30
months, and a statement of income or operations for each of the last 31
2 years next preceding the date of the statement of financial 32
condition, or for the period as of the date of the statement of 33
financial condition if the period of existence is less than 2 years; 34
(d) The issuer of the security has not undergone a major 35
reorganization, merger or acquisition within the preceding 30 days 36
which is not reflected in the information contained in the manual; 37
and 38
(e) At the time of the transaction, the issuer of the security has a 39
class of equity security listed on the New York Stock Exchange, 40
American Stock Exchange or other exchange designated by the 41
Administrator, or on the National Market System of the National 42
Association of Securities Dealers Automated Quotation System. The 43
requirements of this paragraph do not apply if: 44
(1) The security has been outstanding for at least 180 days; 45
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(2) The issuer of the security is actually engaged in business 1
and is not developing the issuer’s business, in bankruptcy or in 2
receivership; and 3
(3) The issuer of the security has been in continuous 4
operation for at least 5 years. 5
4. A nonissuer transaction in a security that has a fixed 6
maturity or a fixed interest or dividend provision if there has been 7
no default during the current fiscal year or within the 3 preceding 8
years, or during the existence of the issuer, and any predecessors if 9
less than 3 years, in the payment of principal, interest or dividends 10
on the security. 11
5. A nonissuer transaction effected by or through a registered 12
broker-dealer pursuant to an unsolicited order or offer to purchase. 13
6. A transaction between the issuer or other person on whose 14
behalf the offering of a security is made and an underwriter, or a 15
transaction among underwriters. 16
7. A transaction in a bond or other evidence of indebtedness 17
secured by a real estate mortgage, deed of trust, personal property 18
security agreement, or by an agreement for the sale of real estate or 19
personal property, if the entire mortgage, deed of trust or agreement, 20
together with all the bonds or other evidences of indebtedness 21
secured thereby, is offered and sold as a unit. 22
8. A transaction by an executor, administrator, sheriff, marshal, 23
receiver, trustee in bankruptcy, guardian or conservator. 24
9. A transaction executed by a bona fide secured party without 25
the purpose of evading this chapter. 26
10. An offer to sell or the sale of a security to a financial or 27
institutional investor or to a broker-dealer. 28
11. Except as otherwise provided in this subsection, a sale or 29
an offer to sell securities of an issuer if: 30
(a) The transaction is part of an issue in which there are not 31
more than 35 purchasers in this State, other than those designated in 32
subsection 10, during any 12 consecutive months; 33
(b) No general solicitation or general advertising is used in 34
connection with the offer to sell or sale of the securities; 35
(c) No commission or other similar compensation is paid or 36
given, directly or indirectly, to a person, other than a broker-dealer 37
licensed or not required to be licensed under this chapter, for 38
soliciting a prospective purchaser in this State; and 39
(d) One of the following conditions is satisfied: 40
(1) The seller reasonably believes that all the purchasers in 41
this State, other than those designated in subsection 10, are 42
purchasing for investment; or 43
(2) Immediately before and immediately after the 44
transaction, the issuer reasonably believes that the securities of the 45
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issuer are held by 50 or fewer beneficial owners, other than those 1
designated in subsection 10, and the transaction is part of an 2
aggregate offering that does not exceed $500,000 during any 12 3
consecutive months. 4
The Administrator by rule or order as to a security or transaction 5
or a type of security or transaction may withdraw or further 6
condition the exemption set forth in this subsection or waive one or 7
more of the conditions of the exemption. 8
12. An offer to sell or sale of a preorganization certificate or 9
subscription if: 10
(a) No commission or other similar compensation is paid or 11
given, directly or indirectly, for soliciting a prospective subscriber; 12
(b) No public advertising or general solicitation is used in 13
connection with the offer to sell or sale; 14
(c) The number of offers does not exceed 50; 15
(d) The number of subscribers does not exceed 10; and 16
(e) No payment is made by a subscriber. 17
13. An offer to sell or sale of a preorganization certificate or 18
subscription issued in connection with the organization of a 19
depository institution if that organization is under the supervision of 20
an official or agency of a state or of the United States which has and 21
exercises the authority to regulate and supervise the organization of 22
the depository institution. For the purpose of this subsection, “under 23
the supervision of an official or agency” means that the official or 24
agency by law has authority to require disclosures to prospective 25
investors similar to those required under NRS 90.490, impound 26
proceeds from the sale of a preorganization certificate or 27
subscription until organization of the depository institution is 28
completed, and require refund to investors if the depository 29
institution does not obtain a grant of authority from the appropriate 30
official or agency. 31
14. A transaction pursuant to an offer to sell to existing 32
security holders of the issuer, including persons who at the time of 33
the transaction are holders of transferable warrants exercisable 34
within not more than 90 days after their issuance, convertible 35
securities or nontransferable warrants, if: 36
(a) No commission or other similar compensation, other than a 37
standby commission, is paid or given, directly or indirectly, for 38
soliciting a security holder in this State; or 39
(b) The issuer first files a notice specifying the terms of the offer 40
to sell, together with a nonrefundable fee of $300, and the 41
Administrator does not [by order] disallow the exemption within the 42
next 5 full business days. 43
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15. A transaction involving an offer to sell, but not a sale, of a 1
security not exempt from registration under the Securities Act of 2
1933, 15 U.S.C. §§ 77a et seq., if: 3
(a) A registration or offering statement or similar record as 4
required under the Securities Act of 1933, 15 U.S.C. §§ 77a et seq., 5
has been filed, but is not effective; 6
(b) A registration statement, if required, has been filed under 7
this chapter, but is not effective; and 8
(c) No order denying, suspending or revoking the effectiveness 9
of registration, of which the offeror is aware, has been entered by 10
the Administrator or the Securities and Exchange Commission, and 11
no examination or public proceeding that may culminate in that kind 12
of order is known by the offeror to be pending. 13
16. A transaction involving an offer to sell, but not a sale, of a 14
security exempt from registration under the Securities Act of 1933, 15
15 U.S.C. §§ 77a et seq., if: 16
(a) A registration statement has been filed under this chapter, but 17
is not effective; and 18
(b) No order denying, suspending or revoking the effectiveness 19
of registration, of which the offeror is aware, has been entered by 20
the Administrator and no examination or public proceeding that may 21
culminate in that kind of order is known by the offeror to be 22
pending. 23
17. A transaction involving the distribution of the securities of 24
an issuer to the security holders of another person in connection 25
with a merger, consolidation, exchange of securities, sale of assets 26
or other reorganization to which the issuer, or its parent or 27
subsidiary, and the other person, or its parent or subsidiary, are 28
parties, if: 29
(a) The securities to be distributed are registered under the 30
Securities Act of 1933, 15 U.S.C. §§ 77a et seq., before the 31
consummation of the transaction; or 32
(b) The securities to be distributed are not required to be 33
registered under the Securities Act of 1933, 15 U.S.C. §§ 77a et 34
seq., written notice of the transaction and a copy of the materials, if 35
any, by which approval of the transaction will be solicited, together 36
with a nonrefundable fee of $300, are given to the Administrator at 37
least 10 days before the consummation of the transaction and the 38
Administrator does not [, by order,] disallow the exemption within 39
the next 10 days. 40
18. A transaction involving the offer to sell or sale of one or 41
more promissory notes each of which is directly secured by a first 42
lien on a single parcel of real estate, or a transaction involving the 43
offer to sell or sale of participation interests in the notes if the notes 44
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and participation interests are originated by a depository institution 1
and are offered and sold subject to the following conditions: 2
(a) The minimum aggregate sales price paid by each purchaser 3
may not be less than $250,000; 4
(b) Each purchaser must pay cash either at the time of the sale or 5
within 60 days after the sale; and 6
(c) Each purchaser may buy for the purchaser’s own account 7
only. 8
19. A transaction involving the offer to sell or sale of one or 9
more promissory notes directly secured by a first lien on a single 10
parcel of real estate or participating interests in the notes, if the 11
notes and interests are originated by a mortgagee approved by the 12
Secretary of Housing and Urban Development under sections 203 13
and 211 of the National Housing Act, 12 U.S.C. §§ 1709 and 1715b, 14
and are offered or sold, subject to the conditions specified in 15
subsection 18, to a depository institution or insurance company, the 16
Federal Home Loan Mortgage Corporation, the Federal National 17
Mortgage Association or the Government National Mortgage 18
Association. 19
20. A transaction between any of the persons described in 20
subsection 19 involving a nonassignable contract to buy or sell the 21
securities described in subsection 18 if the contract is to be 22
completed within 2 years and if: 23
(a) The seller of the securities pursuant to the contract is one of 24
the parties described in subsection 18 or 19 who may originate 25
securities; 26
(b) The purchaser of securities pursuant to a contract is any 27
other person described in subsection 19; and 28
(c) The conditions described in subsection 18 are fulfilled. 29
21. A transaction involving one or more promissory notes 30
secured by a lien on real estate, or participating interests in those 31
notes, by a mortgage company licensed pursuant to chapter 645B of 32
NRS to engage in those transactions. 33
22. A transaction involving an offer to sell or sale of a security 34
to a Nevada certified investor if all of the following conditions are 35
satisfied: 36
(a) The transaction satisfies the requirements for exemption 37
under section 3(a)(11) of the Securities Act of 1933, 15 U.S.C. § 38
77c(a)(11) and Rule 147 or 147A of the Securities and Exchange 39
Commission, 17 C.F.R. § 230.147 or 230.147A. 40
(b) The transaction satisfies any requirements established by the 41
Administrator by regulation pursuant to NRS 90.533. 42
(c) For a transaction involving the sale of a security to a Nevada 43
certified investor described in paragraph (b) of subsection 1 of NRS 44
90.257, the transaction would not result in the Nevada certified 45
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- *SB76*
investor investing more than 10 percent of the net worth of 1
the investor in securities that were purchased by the Nevada 2
certified investor in transactions exempt from NRS 90.460 and 3
90.560 pursuant to this subsection. For the purposes of meeting the 4
requirements of this paragraph, the equity the Nevada certified 5
investor holds in a primary residence must not account for more 6
than 50 percent of the net worth of the Nevada certified investor. 7
(d) The person offering to sell or selling the security has 8
submitted to the Administrator: 9
(1) A complete set of his or her fingerprints and written 10
permission authorizing the Administrator to submit the fingerprints 11
to the Central Repository for Nevada Records of Criminal History 12
for its report on the criminal history of the person and for 13
forwarding to the Federal Bureau of Investigation for its report on 14
the criminal history of the person; 15
(2) The latest available balance sheet of the issuer; and 16
(3) A description of any compensation paid by the person 17
offering to sell or selling the security to any person authorized to 18
make decisions on behalf of or exert control over the management 19
or operation of the person offering to sell or selling the security. 20
(e) The person offering to sell or selling the security has made 21
available to any Nevada certified investor wishing to purchase the 22
security: 23
(1) A full disclosure of any and all previous criminal 24
convictions; and 25
(2) The information submitted to the Administrator pursuant 26
to subparagraphs (2) and (3) of paragraph (d). 27
Sec. 10. NRS 90.710 is hereby amended to read as follows: 28
90.710 1. This chapter must be administered by the Secretary 29
of State and the Administrator. The Secretary of State may employ 30
personnel necessary to administer the provisions of this chapter. 31
2. All money received by [the] : 32
(a) The Division [or the Administrator] pursuant to this chapter 33
must be deposited with the [state] State Treasurer for credit to the 34
State General Fund. 35
(b) The Administrator, as a result of an action for the 36
enforcement of the provisions of this chapter, must be deposited 37
with the State Treasurer for credit to the Fund for the 38
Compensation of Victims of Securities Fraud created by section 6 39
of this act. 40
Sec. 11. NRS 239.010 is hereby amended to read as follows: 41
239.010 1. Except as otherwise provided in this section and 42
NRS 1.4683, 1.4687, 1A.110, 3.2203, 41.0397, 41.071, 49.095, 43
49.293, 62D.420, 62D.440, 62E.516, 62E.620, 62H.025, 62H.030, 44
62H.170, 62H.220, 62H.320, 75A.100, 75A.150, 76.160, 78.152, 45
– 15 –
- *SB76*
80.113, 81.850, 82.183, 86.246, 86.54615, 87.515, 87.5413, 1
87A.200, 87A.580, 87A.640, 88.3355, 88.5927, 88.6067, 88A.345, 2
88A.7345, 89.045, 89.251, 90.730, 91.160, 116.757, 116A.270, 3
116B.880, 118B.026, 119.260, 119.265, 119.267, 119.280, 4
119A.280, 119A.653, 119A.677, 119B.370, 119B.382, 120A.640, 5
120A.690, 125.130, 125B.140, 126.141, 126.161, 126.163, 126.730, 6
127.007, 127.057, 127.130, 127.140, 127.2817, 128.090, 130.312, 7
130.712, 136.050, 159.044, 159A.044, 164.041, 172.075, 172.245, 8
176.01334, 176.01385, 176.015, 176.0625, 176.09129, 176.156, 9
176A.630, 178.39801, 178.4715, 178.5691, 178.5717, 179.495, 10
179A.070, 179A.165, 179D.160, 180.600, 200.3771, 200.3772, 11
200.5095, 200.604, 202.3662, 205.4651, 209.392, 209.3923, 12
209.3925, 209.419, 209.429, 209.521, 211A.140, 213.010, 213.040, 13
213.095, 213.131, 217.105, 217.110, 217.464, 217.475, 218A.350, 14
218E.625, 218F.150, 218G.130, 218G.240, 218G.350, 218G.615, 15
224.240, 226.462, 226.796, 228.270, 228.450, 228.495, 228.570, 16
231.069, 231.1285, 231.1473, 232.1369, 233.190, 237.300, 17
239.0105, 239.0113, 239.014, 239B.026, 239B.030, 239B.040, 18
239B.050, 239C.140, 239C.210, 239C.230, 239C.250, 239C.270, 19
239C.420, 240.007, 241.020, 241.030, 241.039, 242.105, 244.264, 20
244.335, 247.540, 247.545, 247.550, 247.560, 250.087, 250.130, 21
250.140, 250.145, 250.150, 268.095, 268.0978, 268.490, 268.910, 22
269.174, 271A.105, 281.195, 281.805, 281A.350, 281A.680, 23
281A.685, 281A.750, 281A.755, 281A.780, 284.4068, 284.4086, 24
286.110, 286.118, 287.0438, 289.025, 289.080, 289.387, 289.830, 25
293.4855, 293.5002, 293.503, 293.504, 293.558, 293.5757, 293.870, 26
293.906, 293.908, 293.909, 293.910, 293B.135, 293D.510, 331.110, 27
332.061, 332.351, 333.333, 333.335, 338.070, 338.1379, 338.1593, 28
338.1725, 338.1727, 348.420, 349.597, 349.775, 353.205, 29
353A.049, 353A.085, 353A.100, 353C.240, 353D.250, 360.240, 30
360.247, 360.255, 360.755, 361.044, 361.2242, 361.610, 365.138, 31
366.160, 368A.180, 370.257, 370.327, 372A.080, 378.290, 378.300, 32
379.0075, 379.008, 379.1495, 385A.830, 385B.100, 387.626, 33
387.631, 388.1455, 388.259, 388.501, 388.503, 388.513, 388.750, 34
388A.247, 388A.249, 391.033, 391.035, 391.0365, 391.120, 35
391.925, 392.029, 392.147, 392.264, 392.271, 392.315, 392.317, 36
392.325, 392.327, 392.335, 392.850, 393.045, 394.167, 394.16975, 37
394.1698, 394.447, 394.460, 394.465, 396.1415, 396.1425, 396.143, 38
396.159, 396.3295, 396.405, 396.525, 396.535, 396.9685, 39
398A.115, 408.3885, 408.3886, 408.3888, 408.5484, 412.153, 40
414.280, 416.070, 422.2749, 422.305, 422A.342, 422A.350, 41
425.400, 427A.1236, 427A.872, 427A.940, 432.028, 432.205, 42
432B.175, 432B.280, 432B.290, 432B.4018, 432B.407, 432B.430, 43
432B.560, 432B.5902, 432C.140, 432C.150, 433.534, 433A.360, 44
439.4941, 439.4988, 439.5282, 439.840, 439.914, 439A.116, 45
– 16 –
- *SB76*
439A.124, 439B.420, 439B.754, 439B.760, 439B.845, 440.170, 1
441A.195, 441A.220, 441A.230, 442.330, 442.395, 442.735, 2
442.774, 445A.665, 445B.570, 445B.7773, 449.209, 449.245, 3
449.4315, 449A.112, 450.140, 450B.188, 450B.805, 453.164, 4
453.720, 458.055, 458.280, 459.050, 459.3866, 459.555, 459.7056, 5
459.846, 463.120, 463.15993, 463.240, 463.3403, 463.3407, 6
463.790, 467.1005, 480.535, 480.545, 480.935, 480.940, 481.063, 7
481.091, 481.093, 482.170, 482.368, 482.5536, 483.340, 483.363, 8
483.575, 483.659, 483.800, 484A.469, 484B.830, 484B.833, 9
484E.070, 485.316, 501.344, 503.452, 522.040, 534A.031, 561.285, 10
571.160, 584.655, 587.877, 598.0964, 598.098, 598A.110, 11
598A.420, 599B.090, 603.070, 603A.210, 604A.303, 604A.710, 12
604D.500, 604D.600, 612.265, 616B.012, 616B.015, 616B.315, 13
616B.350, 618.341, 618.425, 622.238, 622.310, 623.131, 623A.137, 14
624.110, 624.265, 624.327, 625.425, 625A.185, 628.418, 628B.230, 15
628B.760, 629.043, 629.047, 629.069, 630.133, 630.2671, 16
630.2672, 630.2673, 630.2687, 630.30665, 630.336, 630A.327, 17
630A.555, 631.332, 631.368, 632.121, 632.125, 632.3415, 18
632.3423, 632.405, 633.283, 633.301, 633.427, 633.4715, 633.4716, 19
633.4717, 633.524, 634.055, 634.1303, 634.214, 634A.169, 20
634A.185, 634B.730, 635.111, 635.158, 636.262, 636.342, 637.085, 21
637.145, 637B.192, 637B.288, 638.087, 638.089, 639.183, 22
639.2485, 639.570, 640.075, 640.152, 640A.185, 640A.220, 23
640B.405, 640B.730, 640C.580, 640C.600, 640C.620, 640C.745, 24
640C.760, 640D.135, 640D.190, 640E.225, 640E.340, 641.090, 25
641.221, 641.2215, 641A.191, 641A.217, 641A.262, 641B.170, 26
641B.281, 641B.282, 641C.455, 641C.760, 641D.260, 641D.320, 27
642.524, 643.189, 644A.870, 645.180, 645.625, 645A.050, 28
645A.082, 645B.060, 645B.092, 645C.220, 645C.225, 645D.130, 29
645D.135, 645G.510, 645H.320, 645H.330, 647.0945, 647.0947, 30
648.033, 648.197, 649.065, 649.067, 652.126, 652.228, 653.900, 31
654.110, 656.105, 657A.510, 661.115, 665.130, 665.133, 669.275, 32
669.285, 669A.310, 670B.680, 671.365, 671.415, 673.450, 673.480, 33
675.380, 676A.340, 676A.370, 677.243, 678A.470, 678C.710, 34
678C.800, 679B.122, 679B.124, 679B.152, 679B.159, 679B.190, 35
679B.285, 679B.690, 680A.270, 681A.440, 681B.260, 681B.410, 36
681B.540, 683A.0873, 685A.077, 686A.289, 686B.170, 686C.306, 37
687A.060, 687A.115, 687B.404, 687C.010, 688C.230, 688C.480, 38
688C.490, 689A.696, 692A.117, 692C.190, 692C.3507, 692C.3536, 39
692C.3538, 692C.354, 692C.420, 693A.480, 693A.615, 696B.550, 40
696C.120, 703.196, 704B.325, 706.1725, 706A.230, 710.159, 41
711.600, and section 3 of this act, sections 35, 38 and 41 of chapter 42
478, Statutes of Nevada 2011 and section 2 of chapter 391, Statutes 43
of Nevada 2013 and unless otherwise declared by law to be 44
confidential, all public books and public records of a governmental 45
– 17 –
- *SB76*
entity must be open at all times during office hours to inspection by 1
any person, and may be fully copied or an abstract or memorandum 2
may be prepared from those public books and public records. Any 3
such copies, abstracts or memoranda may be used to supply the 4
general public with copies, abstracts or memoranda of the records or 5
may be used in any other way to the advantage of the governmental 6
entity or of the general public. This section does not supersede or in 7
any manner affect the federal laws governing copyrights or enlarge, 8
diminish or affect in any other manner the rights of a person in any 9
written book or record which is copyrighted pursuant to federal law. 10
2. A governmental entity may not reject a book or record 11
which is copyrighted solely because it is copyrighted. 12
3. A governmental entity that has legal custody or control of a 13
public book or record shall not deny a request made pursuant to 14
subsection 1 to inspect or copy or receive a copy of a public book or 15
record on the basis that the requested public book or record contains 16
information that is confidential if the governmental entity can 17
redact, delete, conceal or separate, including, without limitation, 18
electronically, the confidential information from the information 19
included in the public book or record that is not otherwise 20
confidential. 21
4. If requested, a governmental entity shall provide a copy of a 22
public record in an electronic format by means of an electronic 23
medium. Nothing in this subsection requires a governmental entity 24
to provide a copy of a public record in an electronic format or by 25
means of an electronic medium if: 26
(a) The public record: 27
(1) Was not created or prepared in an electronic format; and 28
(2) Is not available in an electronic format; or 29
(b) Providing the public record in an electronic format or by 30
means of an electronic medium would: 31
(1) Give access to proprietary software; or 32
(2) Require the production of information that is confidential 33
and that cannot be redacted, deleted, concealed or separated from 34
information that is not otherwise confidential. 35
5. An officer, employee or agent of a governmental entity who 36
has legal custody or control of a public record: 37
(a) Shall not refuse to provide a copy of that public record in the 38
medium that is requested because the officer, employee or agent has 39
already prepared or would prefer to provide the copy in a different 40
medium. 41
(b) Except as otherwise provided in NRS 239.030, shall, upon 42
request, prepare the copy of the public record and shall not require 43
the person who has requested the copy to prepare the copy himself 44
or herself. 45
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- *SB76*
Sec. 12. The provisions of subsection 1 of NRS 218D.380 do 1
not apply to any provision of this act which adds or revises a 2
requirement to submit a report to the Legislature. 3
Sec. 13. 1. This section becomes effective upon passage and 4
approval. 5
2. Sections 1 to 12, inclusive, of this act become effective: 6
(a) Upon passage and approval for the purpose of adopting any 7
regulations and performing any other preparatory administrative 8
tasks that are necessary to carry out the provisions of this act; and 9
(b) On January 1, 2026, for all other purposes. 10
H